Keithley cuts more jobs, halts product line

SAN FRANCISCOTest-equipment supplier Keithley Instruments Inc. plans to discontinue its S600 Series parametric testing product line and cut 6 percent of its workforce due to lack of demand amid the economic downturn.

Keithley (Cleveland) said it will continue to accept orders for S600 Series testers until February 2010 and will continue to provide technical support, calibration and repair services through February 2014.

In a statement, Chairman Joseph Keithley said the company will no longer pursue fully-automated high-volume parametric test applications but will continue serving the semiconductor industry's R&D and low-volume production test applications with DC instrumentation and chip characterization products.

"Our commitment to the semiconductor industry and to our customers remains strong despite this action," the chairman said.

He noted that analysts are projecting that semiconductor capital equipment spending will decline between 25 and 40 percent in 2009 after contracting roughly 25 percent last year. Keithley said orders for the S600 Series have been declining for many quarters.

Keithley said it expects to save about $4 million per year through the discontinuation of the S600 line. The company said it expects to incur pre-tax charges of between $5 million and $6 million, including $1.2 million associated with the 6 percent workforce reduction.

Keithley said earlier this week it had been notified by the New York Stock Exchange that it is no longer in compliance with listing standards because its total market capitalization fell under $75 million for more than 30 consecutive trading days. The company said its market capitalization as of Feb. 12 was roughly $52.4 million.

Keithley said it plans to comply with rules that allow it to submit within 45 days a plan to comply with the exchange's continued listing standards within 18 months.